Bitpush Week Review: Government Restrictions Continue to Hold Libra Back

In the past week, the cryptocurrency market has continued to weaken, and Libra once again faces strict regulations from global governments, central banks and regulators.

Facebook Libra

Although Libra, the social media giant Facebook’s encryption project, has been questioned by global governments, central banks, regulatory and legislative bodies since the white paper was released on June 18. However, the storm raged against Libra seems to have grown more violent.

The Financial Action Task Force (FATF) of the Global Anti-Money Laundering Regulators said it is paying close attention to Libra's every move. Liu Xiangmin, the new rotating chairman of the organization and the head of the legal department of the People's Bank of China, told Reuters on Tuesday that "we want to ensure that all possible major risks are resolved." Liu Xiangmin said that from money laundering to drug trafficking, illegal use of cryptocurrencies may Spread quickly, the currently known examples might be just the tip of the iceberg of real illegal use.

Sigal Mandelker, deputy finance minister for terrorism and financial intelligence at the US Treasury, said in Geneva, Switzerland, that not only Libra, the cryptocurrency of social media giant Facebook, but other cryptocurrencies operating in the United States or parts of the United States are subject to financial Regulatory rules for crime. Mandelker said, “Whether Bitcoin, Ethereum or Libra, we have the same requirements for all of these companies: anti-money laundering and counter-terrorism financing must be integrated into the design from the start.”

In Switzerland, where the Libra Association is headquartered, FINMA, the financial regulator, said that Libra plans to launch services that clearly exceed the services of pure payment systems, which means it will be subject to additional restrictions, such as capital credit, market & operational risk, risk concentration & transfer and capital allocation of Libra reserve management.

In France and Germany, the two most important economies in continental Europe, Libra suffered heavy blows. French Economy and Finance Minister Bruno Le Maire said they will stop Libra from developing in Europe. The German government is also opposed to authorizing Facebook's upcoming stable currency within the EU. The government “does not allow market-related private stable coins” because “once a digital money provider dominates the market, it is difficult to have competitors.” Le Maire also said that Europe should consider launching its own “public digital currency” that can challenge Libra.

Even other technology companies don't fully support Libra. Twitter CEO Jack Dorsey said in an interview with the media in Australia that Twitter will not support even if the Libra cryptocurrency solves regulatory issues.

Facebook and Libra also responded to some questions this week. In a letter to the US Senator about the encryption project Libra, Facebook said that the legal currency supporting the stable currency may also include the Singapore dollar, which also clearly stated that the yuan will not be in it. Librarian Association Director General Bertrand Perez also said that the Libra cryptocurrency should be launched in the second half of 2020, and the organization is currently working to initiate and remove regulatory barriers.

Cryptocurrency

In the past week, the cryptocurrency market was generally weak. Bitcoin, the highest cryptocurrency market value, continues to trade between $10,000 and $10,600. Indicators reflecting the volatility of Bitcoin have recently reached a four-month low, but some analysts believe that this might be the calm before the storm. Although Bitcoin may continue to consolidate in the short term, there will be large fluctuations after a period of narrow fluctuations.

On Twitter, some analysts said Bitcoin could break through $30,000 in 2021, according to the correlation between price increases and the number of blocks since Bitcoin’s low difficulty in mining.

Analyst Thomas Lee believes that the price of Bitcoin is hesitant because the macroeconomic outlook is uncertain. Once the macro economy takes off, the price of Bitcoin will continue to rise. Although encryption projects, exchanges, and blockchain companies are still active in launching new products and financing mergers and acquisitions, investors in the encryption market are still waiting for the market to start.

The stable coin issuer Tether announced this week that it supports the stable coin CNH₮ linked to the offshore RMB. Tether said that CNH₮ will be linked to the offshore RMB CNH and can only be used as an ERC-20 token on the Ethereum blockchain.

Ripple CEO Brad Garlinghouse said in an interview with CNN that no one can manipulate the price of XRP, and the community can fork XRP. In the interview, Garlinghouse said Ripple is more motivated than ever for people who use XRP to trade.

Breanne Madigan, head of Ripple's global institutional market, also said that XRP is a hybrid between utility tokens and billing tokens, focusing on payment scenarios. "Ripple didn't create XRP, and we didn't control it. If Ripple leaves tomorrow, XRP will continue to exist like our network. Currently there are 150 nodes on our network, and Ripple only runs 7 of them."

The Stellar Development Foundation and messaging service provider Keybase announced that it will cooperate to airdrop 2 billion XLM tokens. The total value of airdrops will reach $120 million, which is the largest airdrop in Stellar's five-year history. According to Keybase, in the next 20 months, Keybase users receive an airdrop of 100 million XLM per month.

Tron CEO Justin Sun retweeted a New York Times report on US Democratic candidate Andrew Yang, who said in Democrat debate on Thursday that he would issue $1,000 a month to 10 people next year. Justin Sun commented, “Yang pays 1,000 dollars to 10 people every month. I promise to pay 1,000 dollars to 100 people in 2020. One of them will have the opportunity to participate in my lunch with Buffett. Yang will help me pick out these 100 lucky ones."

Dash, the 16th cryptocurrency by market cap, will land on the Coinbase Pro trading platform next Monday. At 10 am Pacific Standard Time on September 16, users will be able to transfer Dash to their Coinbase Pro account. After the news came out, the price of Dash rose by more than 10%.

The main cryptocurrency Ethereum Classic (ETC) network completed a system-level software upgrade on Thursday night. The upgraded version is called "Atlantis", which requires all software users to upgrade the client to reach a new consensus. According to news from startup ETC Labs, 10 Ethereum Improvements Proposals (EIPs) were included to improve network stability and performance, and added opcodes, pre-compiled contracts, zk-SNARK capabilities and stronger safety.

AnChain.Ai researchers released a blog on Wednesday saying that ChainLink tokens are suspected of price manipulation. The Chainlink (LINK) token is a service-oriented blockchain native cryptocurrency issued by the Japanese news giant LINE. According to the blog post, through the analysis of the ChainLink token transaction in the past six months, it has obvious characteristics of “Pump and Dump”. Researchers say, "Cryptocurrencies are often particularly vulnerable to this form of attack because they are usually concentrated in the hands of a relatively small number of people whose market activity can significantly affect prices."

Exchange

Stock exchange operator NASDAQ this week added DeFix, an index related to decentralized finance (DeFi). NASDAQ has partnered with London-based brokerage firm EXANTE to provide the DeFix index, which includes "real-time" information on projects such as Augur and MakerDAO, which is another step for NASDAQ to move toward the encryption industry. Nasdaq said, "DeFiX is the first cryptocurrency index to reflect the dynamics of the most promising blockchain projects in the decentralized finance sector, including projects such as Augur, Gnosis, Amoveo, Numerai, Maker and 0x."

Bakkt, the exchange that is about to launch physical settlement of Bitcoin futures, said on Twitter that its hosted bitcoin is protected by a $125 million policy. The Intercontinental Exchange (ICE) also announced the provisional margin requirements for Bakkt Bitcoin futures trading contracts. The initial hedge margin requirement for day and month futures contracts is $3,900, and the initial speculative margin requirement for two contracts is $4,290. The monthly value-added hedges for daily and monthly futures contracts range from $400 to $1,000, with speculative rates ranging from $440 to $1,100. The provisional margin requirement will be valid after September 23, 2019.

Kayvon Pirestani, head of sales at Coinbase Asia, the main cryptocurrency exchange, said Coinbase may soon launch an initial exchange-issued (IEO) platform and issue proprietary trading tokens. Pirestani said that the IEO platform is one of several capital tools that Coinbase is currently exploring. “In a nutshell, Coinbase is carefully exploring not only the IEO space, but also STOs [securities token offerings]. But I can’t make any formal announcements right now."

Binance announced on Monday that it will launch a third phase of lending products, with new support for XRP, Litecoin and USDC. The currency futures trading platform was also launched on September 13. All users will receive a 50% discount on transaction fees in the first three months. Users who participate in the futures platform test and vote for the Future A platform will receive a total discount of 75% on the transaction cost in the first month. The US dollar stable currency BUSD will also be launched online next week.

In addition, Binance U.S. will also begin to accept new user registration on September 18, users can deposit in six cryptocurrencies such as Bitcoin, Ethereum, XRP, Bitcoin cash, Litecoin and USDT. According to the announcement, at this stage, the user can register for the Binance U.S. account and select the verification level required to reach the required withdrawal limit. The user needs to provide a valid ID, such as a passport, driver's license or social security number. Verified users will be able to deposit digital assets.

Crypto exchange Gemini is launching an instituional-grde crypto storage solution, Gemini Custody. It is supported by the New York Department of Financial Services (NYDFS), which will enable customers to immediately trade assets by offering them credit. And this week crypto brokerage Tagomi launched platform to make it easier to short bitcoin and Ethereum. The Tagomi platform allows its users to lend or borrow Bitcoin and Ethereum to facilitate long or short trades, and the exchange is currently reducing short-selling time by enabling instant access to multiple counterparties from a single platform.

Other news

Jeremy Allaire, CEO of the encryption trading company Circle, said in an interview with CNBC that China's central bank digital currency will promote the internationalization of the Renminbi. “I think this has achieved multiple goals at the same time. There is a great opportunity here, which is a way to promote the circulation of the Renminbi on a global scale.” Allaire said, “It will form a mechanism through which the renminbi It can be used for daily transactions around the world. This will eventually become the basis for the internationalization of the RMB." Allaire also pointed out that China's proposed digital currency "will bypass the Western banking system and the SWIFT system, etc.", which is "very strategic."

Indian billionaire and Congressman Rajeev Chandrasekhar said in an interview that the Indian government is not totally opposed to cryptocurrencies, but it still takes some time. Regarding the encryption ban that India has drafted in the past few months, Chandrasekhar said that the Indian government is only trying to protect the people. On the other hand, the government has not tried to involve encryption supporters in the development of regulations on cryptocurrencies. Regarding why the Indian bank RBI wants to adopt a ban on cryptocurrencies, Chandrasekhar believes that it is difficult for the government to respond to the problems caused by cryptocurrencies, so they instinctively shut them out.

In Cuba, the development of the mobile Internet in the past year has opened the way for cryptocurrency transactions. The number of encryption enthusiasts in Cuba has soared as cryptocurrencies can help bypass the barriers created by the United States to sanction Cuba. The trade embargo launched by the United States decades ago has left Cubans outside of traditional international payment systems and financial markets. As a result, many Cubans are buying digital currencies because they are mostly unregulated and decentralized and anonymous, making it easy to buy online as well as invest and trade.

Technology giant Amazon announced the Amazon Quantum Ledger Database (QLDB), which provides high-performance, immutable, cryptographically validated ledgers for applications, and uses centralized, trusted organizations to maintain complete, verifiable transaction records. Amazon QLDB provides users with familiar database capabilities that are easy to use and flexible in using document-oriented data models, allowing customers to store structured and unstructured data in ledgers. Amazon QLDB does not need to build complex auditing capabilities in a relational database or rely on the ledger functionality of the blockchain framework. It uses an immutable transaction log to track changes to each application's data and maintain a complete and verifiable history over time. All changes are recorded in an encrypted and verifiable history, and customers can analyze them using familiar SQL queries.

Author: Ramsey Baker & Liang Che

Related Articles